Three Arrows Capital’s (Third Arrows) founders are seeking funding for their proposed crypto exchange. Known as GTX, this new venture is meant to be a platform that will enable people to buy and sell claims owed to creditors of bankrupt crypto companies. Currently, there is a $20 billion market for such claims. That may make the business viable.
The co-founders of Three Arrows, Su Zhu and Kyle Davies, are looking to raise $25 million for the venture. They plan to partner with CoinFLEX, a crypto-focused investment firm founded by Sudhu Arumugam and Mark Lamb.
While CoinFLEX has a number of issues, including financial ones, they have also clarified their plans with the co-founders of Three Arrows. According to CoinFLEX, the funds raised will be used for operational growth and will help them to add new asset classes to their portfolio. However, it seems as if the community isn’t very impressed by the company’s plans. Many users have expressed confusion over the venture’s pitch deck. Some have even gone so far as to say that the team should be ashamed of themselves.
The co-founders of 3AC are believed to be hiding in Bali or Dubai, but there is still no official confirmation of this. According to reports, the two founders were served subpoenas via Twitter and e-mail. It is unknown whether or not they will respond to these demands. If they do, they will likely be asked for records of their business.
Three Arrows Capital was once one of the largest crypto hedge funds in the world. At its peak, the firm had assets of US$4 billion. But, in June, the fund collapsed after making leveraged bets on digital tokens. During that period, the value of the crypto market plummeted. As a result, the bankrupt firm owes its creditors nearly US$3.5 billion. This has triggered numerous criminal and regulatory investigations.
Meanwhile, the liquidators of the collapsed fund have been on a global chase for Su Zhu. A US court order required comprehensive discovery of the firm. In addition, there are allegations that the three former co-founders are under investigation by the Commodity Futures Trading Commission, the Securities and Exchange Commission and the Securities and Exchange Commission of Singapore.
In recent weeks, Zhu and Davies have become increasingly vocal on social media. They have authored claims on Three Arrows Capital, as well as on other crypto companies. Their recent actions on social media have prompted many crypto investors to stay away from the venture. There are also suspicions that they are seeking funding for a new crypto exchange.
Although the project has not yet been officially announced, the proposed name of the venture suggests that it will be similar to FTX, a failed crypto exchange. FTX is currently bankrupt. Hence, the name “GTX” is likely a play on this.
Whether or not this new venture will work will be dependent on how much money is raised. Currently, there are no institutional investors who are willing to put their money into the new venture. However, there are a number of entrepreneurs who have questioned the integrity of the new venture. #buildwithyusef #gtx #coinflex #suzhu #kyledavies
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